An Abingdon firm plans to relocate its ethanol recycling operation to a vacant city building, which has already drawn concern from some nearby residents and could spark debate at Tuesday’s City Council meeting.

MXI Environmental Services wants the former Crowley Foods building, where it would recycle a variety of consumer products and extract ethanol for fuel. Currently, the operation is near Interstate 81’s Exit 22 in Washington County, Va., and company officials only plan to move that portion of their business.

At its Tuesday meeting, City Council is scheduled to conduct a public hearing and hold first reading on an ordinance to donate the vacant, 12-acre Crowley facility on Gate City Highway near the Bristol Mall. If approved, a second reading would be required at a subsequent meeting.

The city acquired the former dairy plant last spring for $188,000, when the previous owners failed to find a buyer. It closed in early 2009.

The move would allow the firm – which has received a number of complaints from neighbors who live near the current operation about pungent odors and related issues with the Virginia Department of Environmental Quality – to discharge its waste into city sewers instead of the air.

“We’re specifically lacking in our sewer discharge capacity in Abingdon. Bristol has a very large and underutilized wastewater treatment plant,” said Brian Potter, the company’s vice president of operations. “We will be able to discharge our water, which we can’t do now.”

MXI, which plans to establish a new division in Bristol called Dynamic Resources, processed more than 4 million gallons of mouthwash, beer, wine, liquors, perfumes, body wash and other manufactured products last year to generate 850,000 gallons of ethanol, which was sold to fuel companies to burn in vehicles, Potter said.

The Department of Environmental Quality has investigated a series of complaints about the firm’s current recycling operation emitting offensive odors, according to Crystal Bazyk, that agency’s air compliance manager.

“The vast majority of complaints we’ve received have been about odors,” Bazyk said. “In their distillation process, they use a cooling tower, which is where we believe the majority of odor complaints come from.”

The company made changes to reduce odors – at the agency’s direction – but subsequent complaints spurred further review, Bazyk said.

“We required them to provide a best available control technology review to evaluate what others were doing and a draft report is being prepared now,” she added.

Not using that process and disposing of liquids into the sewer should eliminate any concern about odors, company owner Ron Potter said, adding that the dispute with DEQ is another reason to relocate.

“We are not in agreement with them [DEQ],” Ron Potter said. “We opened our permit for their review of best practices and what they want us to do is what we’re proposing to do in Bristol. They want to require us to get a permit and discharge our water to the Washington County Service Authority. Because they [WCSO] don’t have capacity. That would be at considerable cost and we would already have this at the Bristol site.”

The move would also allow the company to dramatically increase its capacity and began accepting soda and other products containing sugar, which could also be refined into ethanol, Ron Potter said.

“We’re currently operating at 30 to 40 percent of our capacity. We could double or triple the amount of materials we process,” he added.

“Nothing would go into the atmosphere,” Harlow said. “Unlike in Abingdon, all of the waste would go into the city sewer system. My understanding is the Washington County Service Authority couldn’t offer them that option, so that’s why they had the problem. I feel like that is a perfect fit for that [Crowley] building.”

Harlow said he recently toured the Abingdon facility and didn’t notice an offensive odor.

The proposed city site is directly adjacent to a residential neighborhood, the mall and other commercial properties. A retirement home, health care facility and school are within a one-mile radius.

Harlow said some people have been “spreading rumors” about what might locate there.

“I’ve had some conversations with residents concerned a chemical plant was going in. We are not doing anything like that. We bought this property so we could control what located there,” the mayor said.

Councilman Guy Odum said he’s also fielded a number of calls.

“I’ve gotten phone calls from people dead-set against it,” Odum said. “I’ve urged them to call the other council members and come and speak at the hearing. It’s important they have their say.”

Odum remains uncertain how he will vote. A three-vote simple majority is required for passage by the five-member council.

“I’m still undecided. Mr. Heaney [Councilman Jim] and I toured the [current] plant,” Odum said. “My understanding is eliminating the cooling tower will do away with a large portion of the odor. But I still have some questions. I want us to be able to control the situation in Bristol, so that if there is a problem, the government in Bristol should be able to handle it.”

Heather Hill, general manager of the Bristol Mall, said Friday she is trying to learn as much as possible about the proposed business.

“I am investigating what would be best for Bristol Mall, its shoppers and the 600 employees we employ here,” Hill said. “I’m not for or against. I’m still researching what the city’s interest is, what the city would receive in return and how air quality will be controlled to meet DEQ requirements.”

Under a proposed agreement, in exchange for the building, MXI is expected to invest $4 million in improvements to the property, create about 30 to 40 jobs and operate there for at least 10 years, City Manager Dewey Cashwell said.

The agreement would also establish a local panel to review any complaints that might arise, in addition to ensuring that all city and state environmental requirements are met, Cashwell said. He added that not only can the city’s wastewater system handle the additional load, it would actually benefit since other industries have closed in recent years.